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More Unequal We Stand? Inequality Dynamics in the United States, 1967–2021
Heathcote et al. (2010) conducted an empirical analysis of several dimensions of inequality in the United States over the years 1967-2006, using publicly-available survey data. This paper expands the analysis, and extends it to 2021. We find that since the early 2000s, the college wage premium has stopped growing, and the race wage gap has stalled. However, the gender wage gap has kept shrinking. Both individual- and household-level income inequality have continued to rise at the top, while the cyclical component of inequality dominates dynamics below the median. Inequality in consumption ...
How Has the COVID-19 Recession Affected U.S. Labor across Occupations and Industries?
COVID-19 hit the U.S. labor market hard, but relative changes in employment and hours worked vary across occupations and industries.
Working Paper
Hours Worked and Lifetime Earnings Inequality
We document large differences in lifetime hours of work using data from the NLSY79 and argue that these differences are an important source of inequality in lifetime earnings. To establish this we develop and calibrate a rich heterogeneous agent model of labor supply and human capital accumulation that allows for heterogeneity in preferences for work, initial human capital and learning ability, as well as idiosyncratic shocks to human capital throughout the life-cycle. Our calibrated model implies that almost 20 percent of the variance in lifetime earnings is accounted for by differences in ...
Report
Analyzing the Influence of Occupational Licensing Duration and Grandfathering on Labor Market Outcomes
The length of time from the implementation of an occupational licensing statute (i.e., licensing duration) may matter in influencing labor market outcomes. Adding to or raising the entry barriers are likely easier once an occupation is established and has gained influence in a political jurisdiction. States often enact grandfather clauses and ratchet up requirements that protect existing workers and increase entry costs to new entrants. We analyze the labor market influence of the duration of occupational licensing statutes for 13 major universally licensed occupations over a 75-year period. ...
Deconstructing Hours Worked: How Did Recent Recessions Differ?
Weekly usual hours worked per capita recovered faster from the COVID-19 recession than from Great Recession because of stable hours per worker and a fast recovery in the employment rate.
Work More, Make Much More? The Relationship between Lifetime Hours Worked and Lifetime Earnings
An analysis suggests that the hours that male workers spend on the job over a career is associated with both higher lifetime earnings and higher earnings growth.
Working Paper
Hours Worked and Lifetime Earnings Inequality
We document large differences in lifetime hours of work using data from the NLSY79 and argue that these differences are an important source of inequality in lifetime earnings. To establish this we develop and calibrate a rich heterogeneous agent model of labor supply and human capital accumulation that allows for heterogeneity in preferences for work, initial human capital and learning ability, as well as idiosyncratic shocks to human capital throughout the life-cycle. Our calibrated model implies that almost 20 percent of the variance in lifetime earnings is accounted for by differences in ...
Labor Force Participation and Hours Worked Recovery: U.S. vs. Europe
The labor force participation rate in the U.S. had returned to its pre-pandemic level by 2023:Q2, but hours worked per person had not. What about in European countries?
Report
Productivity, Taxes, and Hours Worked in Spain: 1970-2015
In the early 1970s, hours worked per working-age person in Spain were higher than in the United States. Starting in 1975, however, hours worked in Spain fell by 40 percent. We find that 80 percent of the decline in hours worked can be accounted for by the evolution of taxes in an otherwise standard neoclassical growth model. Although taxes play a crucial role, we cannot argue that taxes drive all of the movements in hours worked. In particular, the model underpredicts the large decrease in hours in 1975?1986 and the large increase in hours in 1994?2007. The lack of productivity growth in ...
Essay
Racial Equity Could Produce Widespread Economic Gains
An analysis suggests that racial and ethnic equity in employment, hours worked, education and earnings could expand U.S. GDP by trillions of dollars.